Slide 1: Thomas Weisel Partners Technology Conference
Thomas Weisel Partners Technology Conference February 6, 2006
Slide 2: Today's Presentation
Today’s Presentation Today’s Presentation • • Overview of Nanometrics Overview of Nanometrics • • Outlook for Growth and Competitive Position Outlook for Growth and Competitive Position • • Financials Financials
Slide 3: Who is Nanometrics?
Who is Nanometrics? A leading provider of integrated and stand-alone metrology and process control technology to the global semiconductor manufacturing industry Who is Nanometrics?
Slide 4: Semiconductor Manufacturing in the 300mm Era
Semiconductor Manufacturing in the 300mm Era Semiconductor Manufacturing in the 300mm Era As market windows are collapsing… Manufacturing is increasingly expensive, more automated… …taking people out of the cleanroom altogether.
Slide 5: Increasing Importance of Process Control
Increasing Importance of Process Control Increasing Importance of Process Control More metrology More metrology tools required tools required per line per line - More mask layers - More process steps - More single-wafer processes - More importance placed on each wafer ($) - More metrology points on
Slide 6: Trends Driving Integrated Metrology
Trends Driving Integrated Metrology Trends Driving Integrated Metrology • • Accelerating ramp to production Accelerating ramp to production – Speed up the learning cycle • • Improved production economics Improved production economics – Throughput – Footprint – Transport • • Every wafer is valuable E
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Slide 9: Nanometrics Today
Nanometrics Today Nanometrics Today Stand- Alone 60% Other 5% Integrated 35% • • 30 years in the business 30 years in the business • • Leading provider of transparent thin film metrology Leading provider of transparent thin film metrology • • Market flexible, multiple-metrology solutions for both Ma
Slide 10: Who is Accent Optical?
Who is Accent Optical? Who is Accent Optical? • • Metrology company offering several technologies: Metrology company offering several technologies: – Overlay metrology – Thin film metrology (film characterization, wafer mapping) – Optical CD – Defect detection • • Serving diverse markets: Serving di
Slide 11: Today's Presentation
Today’s Presentation Today’s Presentation • • Overview of Nanometrics Overview of Nanometrics • • Outlook for Growth and Competitive Position Outlook for Growth and Competitive Position • • Financials Financials
Slide 12: Nanometrics' Growth Opportunities
Nanometrics’ Growth Opportunities Nanometrics’ Growth Opportunities • • Increase in semiconductor capital spending Increase in semiconductor capital spending • • Greater importance of process control as % of CapEx Greater importance of process control as % of CapEx • • Growing market for NAND/Flash
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Slide 17: Constant Innovation, Expanding Product Line
Constant Innovation, Expanding Product Line Constant Innovation, Expanding Product Line Core Products with Leading Market Share Atlas/FLX - Transparent Film Thickness 9010/BOLTS - Dielectric CMP, CVD New Products and Expanding Markets Orion - Advanced Overlay Control Atlas-M - Mask and Reticle Metro
Slide 18: Market Size in $millions
Market Size in $millions ONAND metnes
Slide 19: ONAN cS
ONAN cS ene ene ene ene ce a c - - - i i i i i i i i i i i i i i i i i i i é ,
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Slide 21: Expanding Presence in Key Markets
Expanding Presence in Key Markets Expanding Presence in Key Markets Non-Metal TF Integrated OCD/Profile Overlay Macro Defect Mask Tied for #2 with TWAV KLA #1, Rudolph #4, Accent #5 Leading Market Share Nova #2 KLA, TEL and Rudolph <$10M NANO a newer entrant; only one with integrated KLA and TWAV ha
Slide 22: ONAND metncs
ONAND metncs Ea oo” fa =” TOSHIBA TOSHIBA — a Sing INS IDEN one eens @Headway Me canna @> pee MNICHIA == % DongbuAnam Semiconductor
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Slide 26: Positioned with Customers at the Forefront of 300mm
Positioned with Customers at the Forefront of 300mm Accent Top Customers Accent Top Customers Nanometrics Top Customers Nanometrics Top Customers Positioned with Customers at the Forefront of 300mm - Other major - Other major
Slide 27: Accent Acquisition Expected to Strengthen Position
Accent Acquisition Expected to Strengthen Position Accent Acquisition Expected to Strengthen Position • • Huge customer cross-selling opportunities Huge customer cross-selling opportunities • • Stronger player with greater scale Stronger player with greater scale • • Complementary technologies Compl
Slide 28: Today's Presentation
Today’s Presentation Today’s Presentation • • Overview of Nanometrics Overview of Nanometrics • • Outlook for Growth and Competitive Position Outlook for Growth and Competitive Position • • Financials Financials
Slide 29: Creating Operating Leverage
Creating Operating Leverage Creating Operating Leverage • • Streamlined business in 2005 Streamlined business in 2005 – Focus on semiconductors; sold FPD business • • Upgraded financial team Upgraded financial team – CFO, Chief Accounting Officer and Corporate Controller – Increased controls, better
Slide 30: Scaling the Business
Scaling the Business $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $100 Quarterly Revenues Annualized Scaling the Business 2002 2003 2004 2005
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Slide 32: Third Quarter 2005 Financials
Third Quarter 2005 Financials Third Quarter 2005 Financials Revenue $ 14.2 M Gross Margin 38% Operating Expenses $ 9.0 M Operating Loss ($ 3.7 M) Net Loss ($ 3.4 M) EPS ($ 0.26) Cash and Short-Term Investments $ 46.5 M Debt $ 2.0 M
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Slide 34: Significant Operating Leverage in the Model
Significant Operating Leverage in the Model Significant Operating Leverage in the Model Recent Results Target Model Product Gross Margin 51% 60% Service Gross Margin (12%) 20% Blended Gross Margin 43% 55% SG&A 29% 21% R&D 18% 14% Operating Margin (4%) 20% Re-organize Engineering Leverage Service Gro
Slide 35: Conclusion: Nanometrics is in a Strong Position
Conclusion: Nanometrics is in a Strong Position Conclusion: Nanometrics is in a Strong Position • • Right market segment Right market segment • • Well positioned with customers that are spending Well positioned with customers that are spending money on 300mm money on 300mm • • Right complement of pr
Slide 36: Additional Information and Where to Find It
Additional Information and Where to Find It Additional Information and Where to Find It In connection with the planned merger (the “Merger”) between Nanometrics, Inc. (“Nanometrics”) and Accent Optical Technologies, Inc. (“Accent”) pursuant to the Agreement and Plan of Merger and Reorganization date
Slide 37: Additional Information and Where to Find It
Additional Information and Where to Find It Additional Information and Where to Find It Nanometrics and its executive officers and directors may be deemed to be participants in the solicitation of proxies from Nanometrics’ and Accent’s shareholders with respect to the transactions contemplated by th
Slide 38: Forward Looking Statements
Forward Looking Statements Forward Looking Statements This communication contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, such as statements regarding the expected cost savings, impact of the Merger on opera